It is no secret that insurance companies love statistics and calculating risk. There are a lot of statistics and risks that play a factor in your life expectancy that you might not be aware of.
Criminal record: People that have criminal records tend to have riskier lifestyles that resort in shorter life expectancy. If you have a non-violent drug charge from 20 years ago, with no recent charges it will probably not affect your underwriting. However, if you went to prison for a violent charge 5 years ago and are recently out of prison, this could prevent you from ever obtaining coverage. If you are currently on probation or parole, no matter the charge, it is generally always an automatic denial of coverage for traditionally underwritten policies. This is because if you violate your probation or parole you will return to prison and due to the poor health care conditions and being in a more dangerous environment that can lead to premature death.
Driving record: It is kind of like car insurance; the better driver you are the lower your rate will be. Your driving record can affect if you are able to obtain coverage at all. We all know that driving is dangerous. However, if you are getting DUIs, multiple speeding tickets, or are in multiple at-fault collisions, it is even more dangerous. If it has been more than 3 years since your last ticket or at-fault accident, this should not affect your rate. Just one more incentive to be a safe driver.
Financial history: Insurers have found that people with better credit scores tend to have longer life spans. Your credit score is not something that is taken into consideration as far as underwriting goes, however, bankruptcy is. Bankruptcy can indicate a record of making poor financial decisions and can indicate your likelihood of risky behavior. Insurance providers are hyper aware of fraud. An unstable financial history may indicate that a proposed insured may be purchasing a policy for nefarious purposes. However, just because you have had a bankruptcy in the past or are currently in bankruptcy does not mean you will not be able to purchase life insurance. There are a number of factors that influence your eligibility – what type of bankruptcy, how long ago it was discharged, your current income and occupation, etc. Each insurer will look at each person’s financial situation differently. If you are currently in bankruptcy, it is important to know which chapter and when the bankruptcy will be finished.
What do you do for fun and work? Do you work as a contractor in Afghanistan? Do you like to drive race cars? Go scuba diving? All of these types of higher risk hobbies and careers can certainly impact the likelihood of death. Most of these higher-risk careers and hobbies do not automatically disqualify you from obtaining life insurance, however, it can increase your premiums. Each insurer will look at these hobbies and careers differently and they will have questions about them.
If you do participate in any of these higher-risk activities or careers, are currently in bankruptcy or have recently completed one, have a few dings on you driving record or have a criminal history, ask your independent agent which insurance company would look more favorably on your particular situation and what the best option would be for you.